Third st Bancshares(US:TCBX)2024-11-05 21:17Financial Position - As of September 30, 2024, the company reported total assets of $4.63 billion, total loans of $3.89 billion, total deposits of $3.99 billion, and total shareholders' equity of $450.5 million[123]. - Total liabilities were $4.02 billion, with shareholders' equity at $446.1 million[131]. - Total assets increased by $231.7 million to $4.63 billion as of September 30, 2024, driven by organic loan growth and investment securities purchases[141]. - Total loans rose by $251.0 million (6.9%) to $3.89 billion as of September 30, 2024, with commercial and industrial loans increasing by $236.2 million (18.7%)[142]. - The total deposits reached $3.83 billion as of September 30, 2024, with a ratio of average noninterest-bearing deposits to average total deposits of 11.8%[159]. - Total borrowings decreased from $119.4 million as of December 31, 2023, to $112.6 million as of September 30, 2024, a reduction of approximately 5.8%[161]. - Total shareholders' equity increased to $450.4 million as of September 30, 2024, compared to $412.0 million as of December 31, 2023, reflecting a growth of $38.6 million or 9.4%[165]. Income and Expenses - For the three months ended September 30, 2024, interest income increased by $13.3 million, or 19.2%, to $82.7 million compared to $69.4 million in the same period of 2023[125]. - Net interest income for the nine months ended September 30, 2024, increased by $15.1 million, or 14.8%, primarily due to loan growth and increased yields on loans[127]. - Noninterest income for the three months ended September 30, 2024, increased by $651,000, or 34.9%, to $2.5 million compared to $1.9 million in the same period of 2023[125]. - Income before income taxes for the three months ended September 30, 2024, increased by $9.3 million, or 132.0%, to $16.3 million compared to $7.0 million in the same period of 2023[125]. - Net income for the three months ended September 30, 2024, was $12.8 million, an increase of $7.2 million, or 129.0%, compared to $5.6 million in the same period of 2023[125]. - Total noninterest expense for the nine months ended September 30, 2024, was $77.097 million, an increase of $3.7 million or 5.1% compared to $73.384 million for the same period in 2023[137]. - Salaries and employee benefits for the nine months ended September 30, 2024, were $48.1 million, an increase of $2.0 million or 4.3% compared to $46.1 million for the same period in 2023[137]. Loan and Deposit Growth - The average loans increased from $3.29 billion for the nine months ended September 30, 2023, to $3.74 billion for the same period in 2024, with a yield on loans of 7.84% compared to 7.26% in 2023[127]. - Average loans rose from $3.42 billion in Q3 2023 to $3.80 billion in Q3 2024, with a diversified growth in real estate and commercial loans[130]. - Total loans as a percentage of deposits stood at 49% as of September 30, 2024[142]. - Average interest-bearing deposits grew from $2.76 billion in Q3 2023 to $3.38 billion in Q3 2024[130]. Interest Rates and Margins - The average rate paid on interest-bearing deposits increased from 3.91% for the nine months ended September 30, 2023, to 4.72% for the same period in 2024[127]. - Net interest margin for Q3 2024 was 3.73%, compared to 3.71% in Q3 2023[131]. - Net interest spread for Q3 2024 was 2.82%, up from 2.79% in Q3 2023[131]. - The yield on loans increased to 7.90% for Q3 2024, up from 7.57% in Q3 2023[130]. Credit Quality and Losses - Provision for credit losses for the nine months ended September 30, 2024, was $4.5 million, a decrease from $5.2 million for the same period in 2023[133]. - The allowance for credit losses for loans totaled $39.7 million as of September 30, 2024, remaining stable at 1.02% of total loans[133]. - Nonperforming loans rose to $24.0 million as of September 30, 2024, compared to $17.3 million at the end of 2023, primarily due to five commercial and industrial loans totaling $2.9 million and one commercial real estate loan relationship totaling $7.8 million being placed on nonaccrual[145]. - The ratio of nonperforming loans to total loans increased to 0.62% as of September 30, 2024, from 0.48% as of December 31, 2023[145]. Regulatory and Compliance - The company completed its conversion from a Texas state savings bank to a Texas banking association on March 13, 2024, with the Texas Department of Banking as its primary state regulator[125]. - The company qualifies as an "emerging growth company," allowing it to take advantage of reduced reporting requirements[172]. - The company will lose its emerging growth status if it exceeds $1.235 billion in annual revenues or issues more than $1.0 billion of non-convertible debt over a three-year period[173]. Investments and Securities - As of September 30, 2024, the carrying amount of the security portfolio was $292.1 million, an increase of $114.0 million, or 64.0%, compared to $178.1 million as of December 31, 2023[156]. - Investment securities represented 6.3% of total assets as of September 30, 2024, up from 4.1% as of December 31, 2023[156]. - The company made net purchases of $2.53 billion in various securities, offset by maturities, calls, and paydowns of $2.42 billion during the nine months ended September 30, 2024[156]. Employee and Operational Metrics - The average number of employees decreased from 371 for the nine months ended September 30, 2023, to 361 for the same period in 2024[137]. - The company had 358 employees as of September 30, 2024, down from 369 employees a year earlier, reflecting workforce reductions[138].